A. Classification System

1. The objective of the classification
system is to group employers with similar operations into classifications
so that:

a. The classification reflects the exposures common to
those employers

b. The rate for each classification reflects the loss
exposure common to those employers

2. Subject to certain exceptions,
it is the business of the employer within a state that is classified,
not the separate employments, occupations, or operations within the business.

B. Classification Explanation

Classifications are divided into two types – Basic Classifications
and Standard Exception Classifications.

1. Basic Classifications

Basic Classifications describe the business the employer
is operating. Except for the Standard Exception Classifications,
the term basic classification is applied to all classifications shown
in this manual.

Examples
of classifications that describe the business of the employer:

Business

Classification

Manufacture of a product

Furniture
Manufacturing

A process

Engraving

Construction or erection

Carpentry

A mercantile business

Hardware
store

A service

Beauty
salon

2.
Standard Exception Classifications

Standard Exception Classifications describe jobs or occupations
that are common to many businesses. These common occupations are
not included in the basic classification unless specified in the classification
wording. These classifications are described below.

The above classifications are assigned when all the following
conditions are met:

The
basic classification wording does not include clerical
office or telecommuting employees

Other
rules do not disallow the assignment of Code 8810 or Code
8871

The
employee meets the duties, site, and other requirements
listed below:

1)
Duties

Duties must be limited to the following work activities:

Creation
or maintenance of:

Correspondence

Computer
programs

Employer
records

Files

Telephone
duties and/or telephone sales

Data entry

Operation
of copy or fax machines, unless the insured is in the
business of making copies or faxing for the public

General
office work similar in nature to the above

2)
Site

a) Code 8810 – The duties listed in
Rule 1-B-2-a (1) must take place in a work area that is separated from
the operating hazards of:

Factories

Stores

Shops

Construction
sites

Warehouses

Yards Any
other work areas such as:

Work
or service areas

Areas
where inventory is located

Areas
where products are displayed for sale

Areas to
which the purchaser customarily brings the product from
another area for payment

b) Work stations or service areas
for Code 8810 must be physically separated from the operating hazards
by at least one of the following:

Floors

Walls

Partitions

Counters

Other physical
barriers that protect the clerical employee from the operating
hazards of a business

c) Code 8871 – The clerical duties
as defined in Rule 1-B-2-a (1) above must take place inside the home of
the clerical employee. The location must be separate and distinct
from the employer’s.

3) Other

a) Employees who meet the requirements
for Code 8810 or Code 8871 will not be disqualified from assignment to
these codes if they perform certain incidental non-clerical duties that
are related to their employment. These duties include:

Making
bank deposits

Picking
up or delivering mail

Purchasing
office supplies

Delivering
paychecks or clerical-related documents to employees within
an area exposed to the operative hazards of the business

b) Employees who otherwise meet the
requirements for Code 8810 and Code 8871 will be disqualified from assignment
to this classification if their duties involve:

Outside
sales or outside representatives

Direct
supervision of non-clerical employees not performed in
an eligible site according to Rule 1-B-2-a(2) above

Physical
labor

Work exposure
to the operative hazards of the business that is incidental,
necessary, or related to any business operations other
than a clerical office

This classification is assigned to employees who engage
in duties on or in connection with a vehicle. Garage employees and
employees using bicycles as part of their work duties are included in
this code. Messenger and courier deliveries of documents and goods
owned by the employer are assigned to the governing class code of the
business when the deliveries are made by foot or public transportation.

Code 7380 does not apply when the basic classification
wording includes drivers. Refer to Rule 2-H-3
for vehicles under contract.

c.
Salespersons or Collectors - Outside (Code 8742)

This classification is assigned to employees engaged
in sales or collection duties away from their employer’s premises.

This classification is not assigned to employees who:

Deliver
merchandise

Use
vehicles to deliver or pick up goods, even if they collect
or sell. These employees must be assigned to the classification
applicable to the business for drivers

Use
public transportation or walk to deliver goods even if they
collect or sell. These employees must be assigned to
the governing classification applicable to the business

Travel
between locations of the employer as district or regional
managers to perform various duties not involving outside sales
or collections. Refer
to Rule 2-G-Interchange of Labor.

Code 8742 does not apply when the basic classification
wording includes “Outside Salesperson” and/or “Collector”.

d.
Automobile Salespersons (Code 8748)

This classification is assigned to employees who perform
their duties on or away from the employer’s location. Types of transactions
can include, but are not limited to, sale and/or long-term lease of:

Automobiles

Mobile Homes

Boats

These employees are subject to the same rules and treatment
as Code 8742 – Salespersons or Collectors – Outside.

3. General Inclusions

General Inclusions are operations that appear to be separate
businesses but are included within the scope of all basic classifications.
These operations are not separately classified. They include
the following:

Restaurants
or cafeterias, stores, or day care services operated by the insured
for employee use

Exception:

If these operations are conducted in connection with construction,
erection, lumbering, or mining operations, they must be separately
classified.

Manufacture
of containers by the insured, such as bags, barrels, bottles,
boxes, cans, cartons, or packing cases for sole use in the insured’s
business operations

Medical
clinics, facilities, or hospitals operated by the insured for
its employees

Repair
or maintenance of the insured’s buildings or equipment by the
insured’s employees

Printing
by the insured on its own products, packaging, brochures, or promotional
materials

Piloting
of unmanned aircraft systems or drone aircraft with a combined
weight (including its attached systems, payload, and cargo) of
less than 55 pounds

Exceptions:

(a) Autonomous
drone aircraft computer system designers or programmers who qualify as
clerical office employees in accordance with Rule 1-B-2-a and do not pilot
or operate the drone aircraft are assigned to the appropriate clerical
classification.

(b) If
an employee qualifies as an outside salesperson in accordance with Rule
1-B-2-c, the piloting of the drone aircraft to support their sales duties
is included within the classification assigned to the outside salesperson.

For employees that perform general inclusion duties for more than one basic
classification, refer to Rule 2-G for classification
treatment.

A general inclusion operation must be classified separately if any of the
following conditions apply:

It
is conducted as a separate and distinct business of the insured
(Rule 1-D-3).

It
is specifically excluded in the basic classification wording.

The
principal business is described by a standard exception classification.

Example
of a General Inclusion Exception:

An internet service provider,
classified to the standard exception Code 8810 – Clerical Office Employees
NOC, operates a restaurant for its employees’ use. A restaurant
operated for the insured’s employees is a general inclusion and usually
not separately classified. However, because this business is classified
to a standard exception classification, the restaurant operations must
be separately classified to the appropriate restaurant classification.

4.
General Exclusions

Some operations in the business are so unusual for the
business described in the basic classification they must be separately
classified even though the operations are not conducted as a secondary
business. These operations are called general exclusions. They
are classified separately unless they are specifically included in the
basic classification. General exclusions are:

Aviation
– all operations of ground and flying crews, including piloting
of drone aircraft with a combined weight (including its attached
systems, payload, and cargo) of 55 pounds or more

New
construction or alterations

Stevedoring

Sawmill
operations

Example
of a General Exclusion:

An internet service provider,
classified to the standard exception Code 8810 – Clerical Office Employees
NOC, maintains a private plane, pilot and flight crew for the use of executives
traveling to various work locations. The employer-provided aviation
services are considered a general exclusion. This means that unless
a classification applicable to the business includes aviation, this service
is separately classified. Therefore, the aviation services provided
by the internet service provider must be separately classified to the
appropriate aviation classification(s).

Operations of a higher-rated
classification that have been amended to clerical telecommuting due to
the North Carolina governor-declared stay-at-home order qualify to be
assigned to Classification Code 8871-Clerical Telecommuter Employees for
the duration of the stay-at-home order. This provision shall apply while
the operations perform duties consistent with Code 8871's definition,
from when North Carolina's stay-at-home order took effect on March 30,
2020 and for up to 45 days after the stay-at-home order has been lifted.
This provision shall not apply to operations that meet the definition
of a classification code that includes Clerical Office Employees.

5.
Governing Classification

The governing classification at a specific location or
job is the basic classification, other than a standard exception classification.

The governing classification
is determined in accordance with the Governing Classification Determination
Table.

Governing Classification
Determination Table

If….

Then
the governing classification is the …

A
basic classification produces the greatest amount of payroll

Basic
classification

A
basic classification is applicable but no payroll is assigned

Basic
classification

Multiple
basic Classifications apply

Basic
classification that is assigned the greatest amount of payroll

Multiple
basic classifications apply but no payroll is assigned to any
of the basic classifications

Basic
classification that is the highest rated classification

A
basic classification is not applicable

Standard
exception classification that is assigned the greatest amount
of payroll

The governing classification is used to determine the classification treatment
of:

Miscellaneous
employees

Local
managers

Executive
officers who regularly engage in duties that are usually performed
by a foreperson, superintendent, or worker

Example
of a Governing Classification:

A business has the following
payroll amounts assigned to the following classifications:

$220,000 for Code 2003 – Bakery

$120,000 for Code 8017 – Store:
Retail NOC

$240,000 for Code 8810 – Clerical

The governing code for this
business is Code 2003 because it is the classification code, other than
the standard exception code (8810), with the greatest amount of payroll.

6.
Principal Business

The Principal Business is described by the basic classification
with the largest amount of payroll.

If there is no basic classification other than the general
inclusion or general exclusion operations, the standard exception operation
that generates the largest amount of payroll is considered the principal
business.

Examples
of principal business and how it relates to governing classifications:

A business is involved in two separate
operations, the preparation and sale of blasting agents and blasting
excavation. Consider the following basic classifications
and payrolls:

As this business performs
multiple operations, the principal business is the basic classification
with the greatest amount of payroll, Code 4777. In this example,
the principal business and governing classification are the same.

A business is involved in drywall construction
and has a qualified clerical office with an office manager and
two clerks. Consider the following classifications and payrolls:

The governing classification
and principal business in this example is Code 5445. Although Code
8810 has more payroll, according to Rule 1-B-5 and 1-B-6, the governing
classification and principal business excludes standard exception classifications
(i.e., Code 8810). See the following example for an exception to
these rules.

An internet service provider, classified
to the standard exception Code 8810 – Clerical Office Employees
NOC, provides a child day care service for its employees. An
employer-operated day care service is considered a general exclusion
and must be separately classified to the appropriate child day
care center classifications(s). Since the only basic classification
of the business is represented by a general exclusion operation,
the principal business is the standard exception classification,
Code 8810.

A business is involved in three separate
operations. Consider the following locations, basic classifications,
and payrolls:

The governing classification
at Location 1 is Code 2501, the basic classification at this location
with the greatest amount of payroll. The governing classification
at Location 2 is Code 8010, the basic classification at this location
with the greatest amount of payroll. The principal business for
the insured is Code 8010, the basic classification that has the greatest
amount of payroll for all operations.

C. Classification Wording

The following list provides a description of how classification
wording shall be used:

1. Classification Captions
and Notes

The caption is the heading or the title of the classification.

The note is the phrase that follows the caption.

The classification wording as a whole, including the
caption and note, controls, restricts, or explains the classification
usage. The wording is also referred to as the "phraseology."

Example
of a Classification entry:

Store: Fruit or vegetable
– retail. No handling of fresh meats.

“Store: Fruit of vegetable
- retail” is the caption in the above example.

“No handling of fresh meats”
is the note.

2.
Words and Phrases

a.
All Employees, All Other Employees, All Operations, or All Operations
to Completion

If any of the above phrases are included, no other classification
can be assigned unless noted in the classification wording. This applies
even if some operations or employees are at a separate location.

Exceptions:

The following operations of a business must be separately
classified even if the classification wording includes “All Employees,”
“All Other Employees,” “All Operations,” or “All Operations to Completion”:

Drivers includes drivers, chauffeurs, messengers, and
their helpers as defined in Rule 1-B-2-b.

d. “Includes” or “&”

If “includes” or “&” are in the classification wording,
the operations or employees cited after those terms cannot be separately
classified. Even if the operation or employees may be best described
by another classification or are at a separate location, another classification
cannot be used.

NOTE: If
an insured has more than one basic classification, an employee’s payroll
may be split among the codes appropriate for each operation. Refer
to Rule 2-G for additional information regarding Interchange of Labor.

e. Local Manager

Local manager means an employee who is directly in charge
of the operations in the yard of a business and is exposed to the hazards
of the business. As such, the payroll of the local manager must
be assigned to the governing classification unless another basic classification
assigned to the business specifically includes this employee.

f. “No” or “Not”

A classification that includes a restrictive phrase beginning
with “no” or “not” must not apply to a risk that conducts any operation
described in the restrictive phrase.

Exception:

For construction, mercantile, or mining operations, this
rule applies to each job or location.

g.
NOC (Not Otherwise Classified)

If “NOC” is included in the classification wording, then
that classification applies only if no other classification more specifically
describes the insured’s business.

h.
“Or” or “And”

The term “or” also means “and”. This definition applies
only to these terms as used in a classification’s caption or notes.

Certain classification wording refers to “stories in
height.” A story is defined as (15) feet in height. It is measured
from the lowest point above ground level to the highest point above ground
level.

k.
To Be Separately Rated

If the classification wording contains the phrase “to
be separately rated,” operations or employees referenced in those classifications
must be classified separately.

For rules regarding the assignment of more than one basic
classification refer to Rule 1-D-3.

l. Separate and Distinct Business

Separate and distinct business means an additional operation
of the employer that is not included in the basic classification on the
policy. Refer to the following:

Rule
1.D.3 for the assignment of more than one basic classification

Rule
3.A.5 for the combination of legal entities, separate
locations, and operations on a single policy

D. Classification Procedures

The object of the classification procedure is to assign
the one basic classification that best describes the operations of the
employer within North Carolina. Subject to certain exceptions described
in this rule, each classification includes all of the types of labor found
within the business.

It is the business that is classified, not the individual
employments, occupations, or operations within the business.

1.
Separate Legal Entities

If multiple entities are insured under a single policy,
the classification rules are applied separately to each of these legal
entities.

2. Businesses Not Described
by a Classification

If there is no basic classification that clearly describes
the business, the classification that most closely describes the business
must be assigned. For a business not described by any classification,
provide the wording and code number of the classification that most closely
describes the business in Item 4 of the Information Page of the policy.
All the rules pertaining to the basic classification used must apply
to this operation.

3.
Assignment of More Than One Basic Classification

If an insured’s business meets the conditions of a, b,
or c listed below, more than one basic classification may be assigned.
Operation by definition means activities, enterprises, processes,
secondary businesses, or undertakings.

a. The
basic classification of the insured’s principal business requires certain
operations or employees to be rated separately.

b. The
insured conducts one or more of the following business operations:

Construction
or erection

Farming

Employee
leasing, labor contracting, temporary labor services

Mercantile
business

c.
The insured conducts more than one operation in a state.

1) An insured would be described as
conducting more than one operation in a state if portions of the insured’s
operations are not encompassed by the basic classification applicable
to the insured’s principal business operation. For an insured’s
additional business operations to qualify to be separately classified,
these operations must meet all of the following conditions:

The
operations must be able to exist as a separate business
if the insured’s principal business ceased to exist.

The
operations must be separated from the principal business,
such as in a different building or on the same floor but
physically separated from the principal business by walls
or partitions. Employees engaged in the principal
business must be separated from the operating hazards
associated with the additional operations.

Separate
payroll records must be properly maintained for each of
the operations. Refer to Rule
2-G for additional information.

Example
of two operations that could qualify as two separate businesses:

An insured operates bowling
lanes and a movie theater within the same state. These distinct operations
can qualify as two separate businesses for classification purposes because:

The operations of bowling lanes
and movie theaters are not ordinarily conducted as one
business and, therefore, are not included within each
other’s scope

Either the bowling lane (if
the movie theater ceases to exist) or the movie theater
(if the bowling lane ceases to exist) can be expected
to continue its operations

2) Additional operations not encompassed
in the insured’s principal business must meet all the conditions listed
above in Rule 1-D-3-c (1) for the insured to be
considered engaged in an additional operation. In these instances,
a separate basic classification may be assigned to each operation that
qualifies as a separate additional operation.

3) Additional operations that do not
meet all conditions listed above in Rule 1-D-3-c (1)
have a rate:

Lower than the insured’s
principal business, then all operations must be assigned
to the classification of the insured’s principal business

Higher than or equal
to the insured’s principal business, then all operations
must be assigned to the classification that describes
the additional operation.

4) Policies with more than one classification
may include employees working under several classifications. Payroll
for these employees is subject to the Interchange of Labor rule. Refer
to Rule 2-G.

NOTE: If
the insured does not provide verifiable payroll records specific to the
additional higher rated operation, then the principal and the additional
operations are both assigned to the higher rated classification. For
a description of proper payroll records, refer to Rule
2-G-2.

d.
Construction or Erection Operations

Each type of construction or erection operation must
be assigned to the classification that describes the operation only if
separate payroll records are maintained for each operation.

If separate payroll records are not kept for any construction
or erection operation, the highest rated classification that applies to
the job or location where the operation is being performed must be used.

If a construction or erection operation is included in
the scope of another classification, a separate code cannot be used.

1)
Insured Subcontractors

Insured subcontractors who perform a single type of work
on a construction project or job must be classified based on the classification
that describes the type of work involved.

Exception:

All concrete construction operations including making
and erecting forms, placing reinforcing steel, and stripping forms, when
done by subcontractors, must be classified to the appropriate concrete
construction code.

Example
of how to classify the work performed by an insured subcontractor:

The insured subcontractor
who performs only excavation work in connection with the construction
of a sewer is classified under Excavation (Code 6217) rather than under
Sewer Construction (Code 6306).

2)
Uninsured Subcontractors

Uninsured subcontractors covered under the principal
or general contractor’s policy are classified based on the classifications
that would apply if the work were completed by the principal’s or general
contractor’s employees.

Example
of how to classify the work performed by an uninsured subcontractor:

The uninsured subcontractor
who performs only excavation work, but is covered under the policy of
the principal contractor performing the construction of a sewer, is classified
under Sewer Construction (Code 6306).

e.
Farm Operations

A farm is described as any parcel(s) of land used for
the purpose of agriculture, horticulture, viticulture, dairying, or raising
of stock or poultry, for business or commercial purposes.

A division of payroll is allowed for each separate and
distinct type of commercial farming operation if separate payroll records
are maintained.

If separate payroll records are not maintained for the
commercial farming operations or the records are not clear, the entire
payroll of the farm must be separated on the basis of proportionate acreages.

Each farm classification includes:

All
employees

Drivers

Normal
repair and maintenance of buildings or equipment performed
by the employees of the insured

Operations
usual and incidental to a farm, such as:

Maintenance
of chickens, cows or hogs for family use

A
family orchard or truck garden

Hay
or grain crops raised for the purpose of feeding work
animals on the farm

1) Leased workers must be classified
the same as direct employees of the client performing the same or similar
duties.

2) If the client has no direct employees
that perform the same or similar duties, the leased workers are classified
as if they were direct employees of the client entity.

Example
of how to classify workers assigned to clients of employee leasing companies,
labor contractors, and temporary labor services:

The client is a retail store
classified to Code 8017:

Code 8017 is applicable to
the worker assigned as a cashier, just as it is applicable
to the client’s employee who works as a cashier.

Code 7380 is applicable to
the worker assigned as a delivery truck driver, just as
it is applicable to the client’s employee who drives a
delivery truck.

g.
Mercantile Businesses

A mercantile business is any store or dealer engaged
in the sale of goods or merchandise or in the sale of services. Each
location of the mercantile business is separately classified.

Operations of a store are classified based on the principal
type of merchandise sold and whether the operations are wholesale or retail.
For this rule, principal means more than 50% of gross receipts,
excluding sale of lottery tickets.

The definitions and instructions below must be considered
when determining the appropriate store classification.

1)
Type of Merchandise Sold

If a store sells different types of goods, each of which
may be subject to a different classification, the store is to be assigned
to the classification that best describes the merchandise that generates
more than 50% of gross receipts.

2)
Wholesale vs. Retail

For classification purposes, the term “Retail” is defined
as the sale of merchandise to the general public for personal or household
consumption or use and not for resale.

For classification purposes, the term “Wholesale” is
defined as the sale of merchandise for resale to others or sales to builders,
contractors, manufacturers, or others for use in their business or as
raw materials.

Exception:

If a store’s sales are clearly retail in nature, the
appropriate classification for the retail store may be assigned regardless
of the definition of retail above.

Examples
of store sales that are clearly retail in nature:

A store selling artwork in
a shopping mall whose majority of sales are for artwork
purchased by businesses

A store selling art supplies
in a shopping mall whose majority of sales are to artists
who use the materials in their business

In these cases, the stores
would clearly be classified as retail except for the ultimate use or purchaser
of the products.

3)
Combination of Retail and Wholesale

A store that sells merchandise on both a wholesale and
retail basis must use a classification that is based on whether the majority
of gross receipts come from wholesale or retail sales.

4.
Standard Exceptions

Standard Exceptions must be separately classified unless
specifically included in a classification assigned to the business. Standard
exception classifications apply even if the basic classification includes
phrases such as “all employees” or “all operations.”

5.
Businesses Described by a Standard Exception Classification

If the principal business is described by a standard
exception classification, the operations of all employees not included
in the definition of a standard exception classification must be assigned
to the separate basic classification that most closely describes their
operation.

This rules applies to both an employer's business within
a state and to individual jobs or locations where the governing classification
is described by a standard exception classification.

Example
of principal business that is described by a standard exception code:

The insured
is a public museum:

Professional and clerical employees
are assigned to Code 8810

Maintenance employees are assigned
to Code 9101

Gift shop employees are assigned
to Code 8017

6.
Classifications Limited To Separate and Distinct Businesses

The assignment of certain classifications is limited
by their classification notes to separate and distinct businesses. The
notes may describe an operation that frequently is an integral part of
a business described by another classification.

7.
Repair Operations

Insureds with shop operations that involve the repair
of a product for which there is no repair classification are classified
using the classification code that best describes the manufacturing of
the product, unless the repair work is specifically referred to by another
classification, footnote, or definition in the manual.

Example
of repair operations that are classified to the manufacturing code:

A pump repair business is assigned
to Code 3612 – Pump Mfg. There is no separate code for pump
repair.

A motor repair business is assigned
to Code 3643 – Electric Power or Transmission Equipment Mfg. There
is no separate code for motor repair.

8.
Recycling Operations

a. The collection, sorting, and handling
of recyclable materials for resale to others must use the appropriate
store or dealer classification or the classification that most closely
describes the business.

b. Insureds whose operations involve
the reuse of materials for the production of a new product are classified
using the classification code that applies to the manufacture of the new
product unless the work is specifically referred to by another classification,
footnote, or definition in the manual.

E. Miscellaneous Employees

1. Miscellaneous employees who perform
duties that are commonly performed for separate operations that are subject
to more than one basic classification must be assigned to the governing
classification.

2. Miscellaneous employees include
but are not limited to the following:

NOTE: If
the governing class code is a standard exception, refer to Rule 1-D-5 for additional information.

Example
of classification for miscellaneous employees:

The insured has two
separate operations: a machine shop (Code 3632) on one floor of
the building and a plastics manufacturingbusiness
(Code 4452) on another floor. If it is determined that Code 3632 is the
governing classification, all elevator operators, porters, cleaners, superintendents,
and shipping clerks serving both operations are assigned to Code 3632.

F. Classification
Changes or Corrections

1. Classification changes due to changes
in an insured’s operations will be applied as of the date the change in
operations occurred.

2. Classification corrections that
result in a decrease in premium, whether determined during the policy
period or at audit, must be applied retroactively to the effective date
of the policy.

3. Classification corrections that
result in an increase in premium, must be applied as follows:

If the correction in classification is
effective…

Then the correction is applied…

During
the first 120 days of the policy term…

Retroactively to the inception of
the policy.

After
the first 120 days of the policy term, but before the final 90
days…

As of the date the carrier discovers
the cause for that correction.

During
the last 90 days of the policy term…

Only to a renewal policy, if any.

The effective date of change, for purposes of the time
periods noted in the table above, is the date a carrier applies a classification
change.

Exceptions to the table above:

a. If the classification correction
is the result of an omission or misrepresentation by the insured, its
agents, employees, officers, or directors, then the correction must be
applied from the date on which the change would have applied if such omission
or misrepresentation had not occurred.

b. The above rules do not apply to
the following types of operations; therefore, classifications are assigned
and applied at any time during the term of the policy or at audit:

Construction
or erection

Employee
leasing

Labor
contracting

Temporary
labor services

Professional
employer organizations

Operations
assigned to standard exception classifications

General
exclusions

4. For purposes of Rule 1-F, the reallocation
of payroll among classifications on the policy is not considered a change
or correction in classification(s).

Example
of reallocation of payroll:

An
insured has Codes 8810 and 3632 on its policy. Jane
Doe has been reported in 8810 by the insured. The
auditor discovers that she cleans the office and reassigns
her payroll in 3632. This is permissible because
Code 3632 was already on the policy.

An insured has Codes 3179
and 3076 on its policy. John Doe has been reported
in 3179. The auditor discovers that John Doe interchanges
between 3076 and 3179 operations and there is no division
of payroll. Code 3076 is the higher rated code.
It is permissible to reassign all payroll from 3179
to 3076 because 3076 was already on the policy.

Operations of a higher-rated
classification that have been amended to clerical telecommuting due to
the North Carolina governor-declared stay-at-home order qualify to be
assigned to Classification Code 8871-Clerical Telecommuter Employees for
the duration of the stay-at-home order. This provision shall apply while
the operations perform duties consistent with Code 8871's definition,
from when North Carolina's stay-at-home order took effect on March 30,
2020 and for up to 45 days after the stay-at-home order has been lifted.
This provision shall not apply to operations that meet the definition
of a classification code that includes Clerical Office Employees.

5. No application to change classification(s)
on the grounds that the risk has been improperly classified will be considered
by the NCRB unless:

The
application is filed directly with the Bureau, by the insured
or by the carrier, and

The
application is made during the term of the policy or within
twelve months after the expiration date thereof.

As provided in the standard workers compensation and
employers liability policy, the insurance carrier is permitted to audit
or re-audit within three years after termination of the policy. The
revised audit may be for the purpose of reallocation or amendment of the
payroll or other premium basis, according to the rules, rates, and rating
plans applicable under the manuals used by the carriers at the time the
policy was terminated.